China Labour Bulletin is quoted in the following article. Copyright remains with the original publisher
27 June 2013
BEIJING — U.S. businessman Chip Starnes walked to freedom Thursday after paying off the workers who held him hostage for six days in the factory he founded close to the Chinese capital. And now he plans to re-hire some of the very people who held him.
The dispute, sparked by worker worries about lay-offs and unpaid salaries, highlights the widespread lack of trust between employees and their employers in China, as well as the often desperate measures Chinese workers adopt to protect labor rights that are enshrined in Chinese law but regularly abused in the real world.
Its resolution offers further proof that, in China, taking the law into one's own hands may achieve the best results.
Starnes, 42, co-owner of Specialty Medical Supplies, a Coral Springs, Fla.-based company, had come to the plant last Friday to finalize severance payments for 30 workers who were being laid off as Starnes moved the firm's plastic-injection-molding division to Mumbai, India, where production costs are lower.
The remaining 100 employees, fearful the entire factory would be closed, also demanded similar severance packages, and complained about unpaid wages, a claim Starnes has denied. To force his hand, they barricaded Starnes inside the plant.
A deal was reached by early Thursday morning, when 97 workers received two months' salary and compensation that together totaled almost $300,000, reported the Beijing News, a local tabloid. Starnes told the Associated Press he was forced to give in to the workers' demands, and described his experience over the past six days as "humiliating, embarrassing."
But he plans get back to business, and rehire some of his captors. "We're going to take Thursday off to let the dust settle, and we're going to be rehiring a lot of the previous workers on new contracts as of Friday," he said.
"Everything has been properly resolved," said Chu Lixiang, a local trade union official, her voice hoarse after several days and nights of negotiations. "I just want to tell foreign investors that Huairou has a very good investment environment and fully-fledged laws, they don't have to be scared," said Chu, director of the government-controlled workers union in the Huairou district of Beijing, where the factory is located.
Yet some U.S. businessmen might think twice about investing in China, where several Chinese managers have been killed or injured by angry workers in recent years. The kind of stand-off Starnes endured is not rare, as sometimes workers lack more effective methods to show their rights are being violated, Lin Yanling, a labor relations expert at the China Institute of Industrial Relations, told the Global Times, a Communist Party newspaper.
"The local workers' union should play a very important role in solving workers' claims or difficulties by better communicating with employers," said Lin. "But in many cases, they only get involved when an incident has happened and pay too much attention to keeping stability."
Chinese workers, who are well aware of their legal rights to compensation, as well as often higher "market rate" for compensation, share "a well-founded suspicion of the boss' intentions," said Geoffrey Crothall, communications director for China Labour Bulletin, a Hong Kong-based labor rights group. During the 2008 financial crisis, there were hundreds of cases of fleeing bosses, he said. "The situation is not so bad now but workers are still suspicious whenever there are signs that the factory is closing down or moving away."
While China's court system can sometimes be effective, it is over-stretched and employers can use endless appeals to delay proceedings, said Crothall. "The main problem is clearly the lack of a proper trade union and a mechanism through which that union can negotiate with management whenever issues like lay-offs and relocation come up."
Unless ordinary workers get involved by standing for election in the factory union, and forcing management to talk to them, "strikes and protests will continue to be the order of the day," he said.
Contributing: Sunny Yang